A first look at Federal help…

By
Blog Admin January 15, 2009

The US House Committee on Appropriations chaired by Dave Obey (D-WI) just released its version of the “American Recovery and Reinvestment: Action and Action Now!”. It is a remarkable document in many respects, including what it envisions for health care. As President-elect Obama has said, the recovery plan should be a down payment on health reform—and this would be a hefty down payment.

Billions to stop Medi-Cal cuts: We were expecting something on improving the federal match for Medicaid—and it is there, $87 billion through the end of federal fiscal year 2010, “with additional relief tied to rates of unemployment”. Since California has a low Medicaid matching rate but a high unemployment rate, we can hope for significant help in preventing further cuts in Medi-Cal, California’s Medicaid program, and perhaps even the chance to eliminate the cuts we have already done.

Health benefits for the unemployed: We had heard there might be something to help the unemployed keep their health benefits—what is proposed is breathtaking.

First, the proposal would spend $30 billion to pay 65% of the cost of COBRA for the first 12 months of unemployment.

Second, the proposal would provide Medicaid coverage for unemployed workers up to 200%FPL (about $21,000 a year for an individual). And Medicaid eligibility is based on income at the time of application so what would matter is how much unemployment insurance someone is getting, not what they made last year. Third, for those over 55 who lose their job or who have worked for an employer for 10 years or more, they could keep their COBRA until they are Medicare eligible—of course, after the first year those workers would be expected to pay the full cost of their coverage.

Cost containment: The House Democrats propose major investments in lowering costs and improving quality:· Health information technology: $20 billion. Health IT is the infrastructure for better cost and quality data, for coordinating and managing care, for reducing medical errors and improving patient safety.· Prevention: $3 billion to fight hospital infections, grants to public health departments, immunizations, etc.· Health effectiveness research: $1 billion to compare the effectiveness of drugs, devices and other treatments, based on scientific evidence, not just drug company marketing.· Community health centers: $1.5 billion· Training primary care providers: $600 million· Indian health services: $550 million

Altogether it is between $150 billion and $200 billion into health care nationally, just when we really need it.

Of course this is not a law yet. The Congressional process is just starting. This is a proposal, not the final bill. The US Senate has not yet weighed in. But what a different world! Enough federal Medicaid money to avoid further Medi-Cal cuts in California and probably to reverse those already done. Health benefits for the unemployed, instead of letting people between jobs go without and put their lives at risk. An implicit recognition that keeping people in their 50s and 60s insured helps to save Medicare money. Real investment in cost containment and improving quality.

We are looking forward to implementing whatever becomes law in the new Obama Administration.